We were actually in Cheltenham for the Gold Cup. It had been a Christmas Gift. To say that my mother and I were nervous about being there was an understatement. We were amongst literally thousands of people, without seemingly a care in the world. There wasn’t a lot of information at that stage, just an overbearing inclination that things were going to change.
On the 16th March Boris advised people to stop going to pubs, without actually making it statute. I will refer to that as Boris Johnson’s “avoidance call” day. Consumer confidence was shattered and our businesses slumped to around 20% of normal capacity.
March is normally one of our busiest months, followed by April- August. Not just because of the weather, but because it is our Wedding season, we enjoy Mother’s day, Easter, Holiday weekends, Champions League Finals. The period we have been closed (so far) has always been my favourite time. An annual reminder of why I have spent most of my life in this Industry.
On Friday 20th March, I was at the Dalziel Park. We had two weddings on the go, but yet the Hotel felt eerie, soulless even. Only a trickle of diners were coming through the doors. I listened to Boris formally announce that Pubs were to close that night, as the groom for the following days wedding arrived, carrying favours. That was one of the most difficult conversations to have
The impacts have been devastating financially. Cash Flow just disappeared. Similar to many businesses, we had liabilities from February and no revenue. Despite business rates holidays, we had many unpaid suppliers, payroll, VAT liabilities and so on. We “refunded” tens of thousands for pre-paid events & weddings within two days.
Thankfully we had the reserves to make all of these the payments.
I will applaud our Marketing and sales team at this juncture for calmly reassuring our customers and working with them seamlessly to discuss options. Even despite being in meltdown.
We were given about 6 hours’ notice to close down our businesses.
We weren’t unique.
There are so many stakeholders that are affected by Covid. Not just the businesses itself, but suppliers whom rely on our sector, to guests. Most of all staff. The lifeline was the Furlough Scheme. Jobs were protected for a period at least. But until there is further clarification as to how it will work from August. There is a severe likelihood that many of these jobs will disappear. To contribute to Furlough payments without being able to bring in any revenue will be the cliff edge for the majority of our sector.
Hospitality was the first sector to be impacted by this and will be the last to reopen. Support must be given.
It is incredibly short sighted of the Government to set a limit of Grant Support for businesses with a RV of Under £51k only. There has been little or no support for Lisini, as our RV’s are way in excess of that. I fail to see why they have set that threshold. Do the Government think that larger hospitality businesses don’t have the same operational, financial and staffing concerns as smaller businesses? If this isn’t readdressed and if further support is not in made available then I fear the worst. The jobs and taxes generated by our Industry are essential for the national finances and our economic well-being. In short, it could start the demise of our sector.
The industry also need a more detailed route plan of phased opening for our sector. And clarification of the social distancing measures. I understand that SAGE are reviewing the 2m distancing and UK Hospitality are requesting the results to be published before June 15th. The results will have a huge impact for all hospitality businesses reopening.
Hospitality is a sector built around socialising, so there must to be government support for businesses that continue to be hit by this crisis. Unless things are relaxed, it is unlikely we will reopen until Phase 4. It doesn’t stack up commercially.
Even when we enter out of Covid, we will endure many more challenges in the coming months and perhaps the foreseeable future.
We are now in recession- the worst downturn in decades. Our sector is always the one of the first to be hit in times of austerity. Consumer habits may change. People may have gotten used to socialising on line, and having take-out food delivered to them at home. Conversely, some will want to socialise, dine out and party. We are, after all, social beings. I do certainly hope that people will continue to enjoy going out to eat and drink. We humans are social creatures and need company. Either way, I am quite sure that the Industry will be hit hard, but it will survive. There will be some winners and some losers. Many businesses will close for good.
In conclusion, I remain mildly optimistic. I have seen some wonderfully creative initiatives coming from the sector. I have seen our hard hit industry being at the forefront of donating their premises for their Communities and for the NHS. I am in complete awe of some of my peers. The ingenuity in technology inspires me. For ourselves, we have finally launched our Take Out business (after 6 years of thinking about it) & we have involved ourselves with a local Community Action Group delivering food and services to those in need locally. And some good news, our Golf Club reopened today with an unexpected surge in membership enquiries.
Someone once said, “Don’t let a good recession go to waste”. I have poured over our costs, overheads and contracts, even roles within the organisation, and truly hope that if we get through this we will be leaner, more focussed and in tune with market.
Lastly, the Government and local authorities need to take stock. We are one of the largest contributors to the National economy and we have been operating for the past decade or so on razor thin margins. We used to spend time focussing on what we enjoyed- hospitality. Recently it has been spent on monitoring the rising costs of making a business survive. The added layers of costs to be in business is, in my opinion a deterrent for a raft of people who would be naturally suited to this field. In short- it’s hard to make a decent living, even if the creativity and ingenuity is there.
It’s time for recalibration. It’s time for a permanent VAT reduction in hospitality. It’s time for a total overhaul of the unfair rates system. It’s time to collectively charge consumers more for what they are served, instead of watching our backs for competitor use of deal sites. It’s time to reignite our passion for why we do what we do.
It’s time to make the Hospitality Industry great again.